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Navigating the Affordable Care Act confusion

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Whether or not you're likely to shop for health insurance in the new exchanges set up under the 2010 Patient Responsibility and Affordable Care Act -- otherwise known as "Obamacare" -- now is a good time to brush up on your understanding of how health coverage works.

Aside from the enrollment period for Obamacare, which begins Oct 1 and runs through March, many employers offer workers the chance to sign up for or change benefits this time of year. And the annual enrollment or change period for Medicare benefits runs Oct. 1-Dec. 15.

But many of us have trouble understanding options and terms included in health plans, whether we're covered through employer-subsidized or private insurance, through the new exchanges set up to help an estimated 32 million Americans find coverage or by government plans like Medicare, mainly for the elderly and disabled, and Medicaid, primarily for the poor.

''Half of Americans would fail Health Insurance 101," said Ernie Almonte, who chairs a financial literacy commission for the American Institute of CPAs.

Almonte made that statement in announcing results of a new survey of people with private insurance. Of 1,008 adults surveyed, 51 percent could not correctly identify at least one of three common terms: premium, deductible and co-pay. Nine out of 10 respondents said they knew little or nothing about the health reform law.

A survey of 25- to 64-year-olds -- the age group targeted for Obamacare -- found only 14 percent could correctly define a deductible, a co-payment, co-insurance and out-of-pocket maximum. Many more claimed they did know in the survey conducted by Carnegie Mellon University economists.

For instance, all respondents said they knew what a co-pay was, but just three out of four correctly defined it as the fixed cost an insured person must pay for a service -- such as $20 for a physician visit -- with insurance picking up the rest.

And a new survey from the insurance firm Aflac found three out of four workers think health care reform is too complicated, and that they know little or nothing about the new federal and state health care exchanges or marketplaces. Just more than half -- 53 percent -- said they don't know enough to adequately manage their family's health insurance coverage.

Although plans offered through the exchanges are required to summarize benefits and coverage in plain language, experts say finding optimal coverage out of a long list of possibilities is daunting even for highly educated adults.

The CPAs offer suggestions for choosing health insurance at www.360financialliteracy.org .

Among their tips:

-- Review your health history and behavior. Consider whether you routinely or seldom use medical services, and what changes you expect in the next year.

-- Compare the premiums you'll have to pay against the services that are covered.

-- Compare the coverage features, such as what doctors and hospitals take part in a plan, what benefits of each plan are important to you, and any limits or restrictions.

-- Compare what sort of deductibles, co-pays and other fees you'll have to pay, and what out-of-pocket maximum per year the plan has.

The independent National Institute of Medicine offers "The New Health Care Law and You," an online guide that describes health coverage options and gives rough cost estimates.

The government also provides information on all types of insurance - not just Obamacare - at www.healthcare.gov . The Website includes a glossary of insurance terms.

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